Tech firms are taking up more European offices

Tech firms are taking up more European offices

AI companies are increasing their foothold in major cities to secure talent

Technology companies have been increasing their physical presence in Europe more than ever in 2026, as competitors race to set up offices and research hubs across the continent in their bid for the best talent.

In the second quarter of 2026, artificial intelligence-related foreign direct investment announcements (including headquarters, sales, marketing, support, business services, research and development activities) in the EU and UK reached their highest-ever quarterly level, according to fDi Markets. A record 107 projects were announced between April and June, up from 82 in the previous three months and almost double the 63 projects recorded in the second quarter of 2025.

Real estate data supports tech demand for new offices. In the first quarter of 2026, consultancy JLL estimates that the tech sector took up 400,000 square metres of offices, accounting for a record 20 per cent of total office leasing activity across major European cities. This was up from 18 per cent in the whole of 2025.

Andy Poppink, CEO of leasing advisory at JLL for Emea and Apac, tells fDi that there has been “a significant sectoral shift” with tech’s share of European office leasing overtaking banking and finance. “Demand is strong in certain key markets as companies seek to access top tech talent,” he says.

This expansion comes as more funding pours into the tech sector. European AI start-ups raised a record-breaking $23bn in the first half of 2026, a 130 per cent year-on-year increase on the $10bn raised in the same period of 2025, according to HumanX and Crunchbase data.

This funding will lead to “more occupiers expanding across major European cities which have high AI adoption rates among enterprises, strong talent pools with AI-enabled skills and reliable digital infrastructure,” says Mike Barnes, European office research director at Savills.

Since 2025, London has attracted 86 AI-related FDI projects, the highest of any European city, according to fDi Markets. US data-processing leader Databricks plans to grow its London team to 500 people by 2029. Frontier labs OpenAI and Anthropic have both expanded with new headquarters in the King’s Cross knowledge quarter, the birthplace of Google DeepMind.

A variety of tech companies are committing to new office spaces, with a preference to pay more for the best locations offering proximity to talent, universities and other companies. Across Europe, average tech rents were roughly at parity with the total market in 2019 (€238 vs €259 per square metre per annum), but now sit above it (€342 vs €309 in 2026), according to JLL data.

“Frontier AI labs are the newest and fastest-moving cohort,” says Poppink, noting companies like OpenAI, Anthropic and France’s Mistral. They sign “large blocks quickly, often before they’ve fully scaled revenue” due to fierce talent competition, he adds.

Return-to-office mandates have also contributed to more office space uptake as “companies believe this is necessary to drive productivity and speed-to-market,” he adds.

A variety of US AI leaders, including data firm Palantir, video generation specialist Luma AI and Jeff Bezos-founded Project Prometheus, all are expanding in the UK capital to hire more of the city’s tech talent.

It is not just American companies driving office demand in London. European AI players expanding include Swedish coding app Lovable and legal specialist Legora, German adtech firm Almedia and Danish start-up Spektr.

“London is one of the best places in the world to build a data-driven business, and opening an office here is a natural step as we continue to scale globally,” said Tristan Mackrory, Almedia’s vice-president of people, in a statement.

“Growing our presence in London gives us access to some of the strongest talent in the industry as we build the next evolution of the advertising sector.”

Paris, home to Europe’s best-funded homegrown AI lab Mistral, placed second with 28 AI-related FDI projects since 2025, according to fDi Markets data. Life sciences data specialist Lumos AI, cloud computing firm Oracle and Canadian AI lab Cohere have all also expanded their office space in the French capital.

Spain’s capital Madrid placed third with 26 AI projects, followed by other tech hubs like Dublin (25), Barcelona (21) and Munich (18). Germany’s capital Berlin was the seventh-placed European city (11), followed by Lisbon (9), as well as Luxembourg, Milan and Warsaw (8 projects each).

Shipments have been diverted to Gulf Coast refineries after Nicolás Maduro’s capture

Latest news and data on US foreign investment as a new era begins

Commercial aerospace deliveries struggle to keep up with demand as defence reshapes investment

A third of imports and exports in 2026 have been goods needed for artificial intelligence

Make informed decisions, attract investment and stay competitive in the world of foreign and domestic direct investment.